Further gains took key benchmark indices to fresh record highs in mid-morning trade. The barometer index, the S&P BSE Sensex was up currently up 156.34 points or 0.58% at 27,175.73. A sharp slide in crude oil prices yesterday, 2 September 2014, and higher Asian stocks aided the latest upmove on the domestic bourses. The market breadth indicating the overall health of the market was positive. A survey showed that growth in India's service sector activity slowed last month. The market sentiment was boosted by provisional data showing that foreign funds remained net buyers of Indian stocks during the previous trading session. Realty stocks advanced. Telecom and realty stocks surged. HCL Technologies rose after the company won an order from Australia's Sydney Trains.
Earlier during the day, key indices had pared most of the initial gains soon after firm opening took the Sensex and the Nifty hit yet another record high. An overnight sharp slide in crude oil prices and positive cues from Asian markets had triggered a firm opening on the domestic bourses.
Asian stocks rose after reports showed faster expansion in China's service industries last month and as US manufacturing expanded at the fastest pace in three years last month.
At 11:14 IST, the S&P BSE Sensex was up 156.34 points or 0.58% at 27,175.73. The index jumped 168.68 points at the day's high of 27,188.07 in mid morning trade, a record high for the index. The index rose 47.63 points at the day's low of 27,067.02 in intraday trade.
The CNX Nifty was up 41.25 points or 0.51% at 8,124.30. The index hit a high of 8,130.15 in mid morning trade, a record high for the index. The index hit a low of 8,092.25 in intraday trade.
The market breadth indicating the overall health of the market was positive. On BSE, 1,491 shares gained and 1,001 shares fell. A total of 90 shares were unchanged.
The BSE Mid-Cap index was up 73.03 points or 0.77% at 9,596.80. The BSE Small-Cap index was up 80.29 points or 0.77% at 10,572.71. Both these indices outperformed the Sensex.
Among 30-share Sensex pack, 17 stocks advanced while remaining declined.
Realty stocks advanced. Anant Raj (up 1.85%), D B Realty (up 1.4%), Unitech (up 0.84%), DLF (up 1.09%), Housing Development & Infrastructure (up 0.75%), Godrej Properties (up 1.55%), Prestige Estates Projects (up 0.13%), and Oberoi Realty (up 0.19%) gained.
Sobha Developers rose 1.74% after the company during market hours said that ICRA has upgraded the long-term rating of the company to [ICRA] A (Stable) from [ICRA] A- (Stable) in respect of the various fund and non-fund based credit facilities sanctioned to the company.
Telecom stocks gained. Bharti Airtel (up 4.04%), Idea Cellular (up 0.69%), MTNL (up 6.49%), Reliance Communications (up 1.05%) and Tata Teleservices (Maharashtra) (up 1.59%) edged higher.
HCL Technologies rose 1.44% after the company during market hours announced that it has been selected by Australia's Sydney Trains as a strategic partner to provide bespoke systems support services. HCL will provide end-to-end application management and support services to transform Sydney Trains' IT landscape.
Ballarpur Industries rose 4.83% after the company during market hours said that the board of International Finance Corporation (IFC) has approved investment comprising a combination of an equity investment of up to $100 million and long term loans of up to $150 million in Bilt Paper B.V. - BPBV (formerly known as Ballarpur International Graphic Paper Holdings), a step down subsidiary of Ballarpur Industries. The proposed investments would be subject to satisfactory documentation and satisfaction of all necessary conditions of IFC.
The proposed investments will predominantly be used to prepay some of the existing debts. BPBV is also exploring the possibility of listing of its shares at an overseas stock exchange.
Era Infra Engineering surged 4.75% after the company bagged a construction contract from Airport Authority of India. The company announced the fresh order win at fag end of the day's trading session on Tuesday, 2 September 2014. The stock had declined 0.63% to settle at Rs 15.80 on that day.
The sentiment on the bourses was boosted by provisional data showing that foreign funds remained net buyers of Indian stocks during the previous trading session. Foreign portfolio investors (FPIs) bought shares worth a net Rs 672.81 crore on Tuesday, 2 September 2014, as per provisional data from the stock exchanges.
A decline in crude oil prices added to positive sentiment on the domestic bourses. India imports about 80% of its crude oil requirement. Brent crude futures slumped to a 16-month low yesterday, 2 September 2014, on concern slower manufacturing from Europe to China will curb global oil demand. The contract slipped $2.45 a barrel to settle at $100.34 a barrel on Tuesday, 2 September 2014, the lowest close since 1 May 2013. In today's trading, Brent for October settlement was up 41 cents at $100.75 a barrel. Lower crude oil prices will help India in containing its fiscal deficit, current account deficit and fuel price inflation.
A latest survey released by Markit Economics today, 3 September 2014, showed that growth in India's service sector activity slowed in August 2014. Adjusted for seasonal influences, the headline HSBC India Services Business Activity Index posted 50.6 in August, down from 52.2 in July. On the positive side, weaker activity has softened inflation indicators within the survey.
Asian markets were trading higher today, 3 September 2014 after data underscored that the US economy continues to gather gradual momentum. Key indices in Japan, China, Hong Kong, Taiwan, Singapore, and Indonesia were up 0.23% to 1.94%. In South Korea, the Seoul Composite index was off 0.06%.
The HSBC China services Purchasing Managers' Index rose to a 17-month high of 54.1 in August from 50 in July, HSBC Holdings PLC said today, 3 September 2014, while cautioning that sub-index readings pointed to a mixed picture of economic recovery. The HSBC Composite Output Index posted at 52.8, up from 51.6 in July, and signalled a robust rise in activity levels. Furthermore, it was the strongest expansion of business activity in 17 months.
China's official non-manufacturing activity slightly recovered in August, with the sector's purchasing managers' index (PMI) rebounding to 54.4 in August from 54.2 in July, official data showed today, 3 September 2014.
Trading in US index futures indicated that the Dow could gain 11 points at the opening bell on Wednesday, 3 September 2014. US stocks mostly fell on Tuesday, 2 September 2014, with the S&P 500 holding above 2,000 after rising to another intraday record, as energy companies dropped along with the price of oil and investors fretted whether the European Central Bank would make further monetary policy moves this week.
Among economic data, the Institute for Supply Management said its US manufacturing activity index rose to 59 in August, the strongest since March 2011.
Separately, US construction spending staged a strong rebound in July, rising by the largest amount in more than two years. Construction spending rose 1.8% in July, the biggest one-month gain since May 2012, the Commerce Department reported Tuesday, 2 September 2014. It followed a 0.9% decline in June, the largest setback in a year.
In Europe, a monthly meeting of the European Central Bank (ECB) is scheduled tomorrow, 4 September 2014. There are expectations that the European Central Bank (ECB) will announce quantitative easing in the coming months to bolster growth and counter downward pressures on prices in the euro zone. At US Federal Reserve's annual symposium in the United States on 22 August 2014, ECB President Mario Draghi said that expectations of future inflation in Europe exhibited significant declines at all horizons this month.
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